Report on Operations Management

COMPANY NAME: SUKKUR PLASTICS

Muhammad Haseeb and Group

Sukkur IBA University
Mr. Usmani
About
Sukkur Plastics are the manufacturer of Polyvinyl Chloride(PVC) Pipes. The plant is
located on the Industrial Area Sukkur. They started the operations in 2016 and now
they are covering almost all the interior Sindh in terms of their production.
Company operates 24/7 with the day off on every Friday. They work in two shifts.
On every shift they require almost 10 to 12 workers and in addition two machine
operators that help in any kind of mechanical disturbance in the plant. The plant is
specialized in manufacturing of the PVC pipes only. Their pipes come in different
sizes based on the diameter of the pipe. The size starts from 0.75 inches to 8 inches.
This means that they produce all the sizes from 0.75 – 8 inches. Sukkur Plastics have
two big machines that create Pipes. The First one produces PVC pipes from 0.57
inches to 4 inches and the second one is for the PVC pipes from 5 inches to 8 inches.
They produce pipes in only two colors (white and grey), the mangers said that the
high demand is only for the white color that’s why we don’t use any color pigments
like red, green just because of the demand.

Production Process
Raw Material is the main source of every manufacturing business, and the very
crucial thing is to extract proper raw material. The raw material used from PVC
Pipes is the mixture of different chemicals like Vinyl Chloride Monomer, with
different additives like Plasticizes, Lubricants, Pigments, And Fillers. But the
procedure is easy for the company who are in the business of manufacturing PVC
Pipes. They simple use “PVC Resin”. PVC resin is the appropriate mixture of these
elements they we discussed above. So in short the PVC Pipes manufacturing
companies just use PVC resin in their process.

Now here comes the role of Engro Corporations Limited and its subsidiary Engro
Chemical and Polymers limited. Engro Chemicals is the sole manufacturer of PVC
Resin in Pakistan. Engro Chemicals and polymers product line includes PVC Resin,
Caustic Soda, Sodium Hypochlorite, and Hydrochloric Acid, but their major source
of revenues comes from PVC Resin which they sale under the Brand name “SABZ”.
Almost all the industry of PVC pipes purchases the Resin from Engro Chemicals and
Polymers. It seems that they have created a perfect monopoly in the market.
Our Sukkur Plastics also purchase raw material from Engro Chemicals. they
purchase the resin bags of 25kgs per bag. The cost per bag is around Rs. they
process this raw material in a machine which creates small pellets. Then they input
the pellets in the main machine that produce PVC pipes. At a time 4 to 5 workers
work to make a proper pipe. “If you work properly then it will take only 3-4 minutes
to make a perfect 20 feet long pipe of any size” words by the manager. Then after
the production of the pipes they store these on their invertory storage area. And
the sell to the retailers which then sell to the end consumers.

Muhammad Hassan and Muhammad Haseeb with the Operations Manager of Sukkur Plastics
Organizational competitive edge and operations strategy: Sukkur plastics
Company’s operational strategy focuses on the efficient manufacturing of high-
quality PVC pipes while controlling costs and assuring customer satisfaction. The
following are a few essential elements of an efficient operations plan for such a
corporation.
 Efficient production of high quality PVC pipes:
Sukkur Plastics Company strives to optimize its manufacturing processes in
order to decrease garbage, reduce downtime, and boost productivity. They
accomplish this by utilizing new technology and machinery that increase
speed, accuracy, and precision.
 Managing cost and ensuring customer satisfaction (quality control):
To guarantee that all goods match industry standards and client
expectations, the firm employs strict quality control techniques. This involves
testing and inspecting raw materials, final goods, and production processes
on a regular basis.

Concept of Quality, its control and management: Quality assurance is the

key if a company wants to be in “order winners” category. The concept of quality
in Sukkur Plastics is simple. They have two quality inspector that check the quality
of the pellets first and then in the process they check the dimensional
measurements of the pipes like the pipe is a complete 5 inch or not. And after that
the most important thing they weight the pipe. Sukkur Plastics have 2 weight
machines where they weight the pipes after the production. Like the weight of 4
inch PVC Pipe should be around 8kgs. There is still some deviation in the weights
but that’s okay.
Forecasting needs and how these are fulfilled: Like other basic aspects
forecasting is also an important aspect of all businesses. It is also really crucial
consideration for Sukkur plastics.
1) Demand of product:

Sukkur plastics Company forecasts demand for PVC pipes products by using
previous sales data and market research. They detect patterns and trends in
demand by analyzing sales data, and then utilize this knowledge to estimate future
demand. Market research may also be utilized to uncover new growth prospects
and keep up with market trends.
2) Raw Material supply:

Sukkur plastics manufacturer anticipate raw material supply using a mix of supplier
information, production plans, and market trends. They collaborate with suppliers
to guarantee that they have enough raw materials to satisfy their manufacturing
requirements. They also employ forecasting tools to predict shifts in the availability
of raw materials and cost, allowing them to adapt their production plans and
pricing strategies appropriately.
3) Capacity Utilization:

Sukkur plastics manufacturer anticipate capacity utilization by combining

production statistics and market trends. They examine their manufacturing
processes to find bottlenecks and areas for improvement. They also employ market
research to discover variations in demand that may affect their capacity
requirements, allowing them to modify workforce and manufacturing schedules
accordingly.
Product/service design elements:

 Material Quality:
The PVC material that is being used in the product is of high quality to ensure its
performance and longevity. The kind and grade of PVC to be used, such as rigid or
flexible PVC
 Pipes Dimensions:

For PVC pipes, the specifications of the pipes, such as diameter, wall thickness, and
length are very crucial aspects so to ensure to suit the pipes for the particular
requirements of the intended application. Sukkur plastics make pipes of various
diameters. The minimum diameter is 0.75 and they make pipes of maximum
diameter of 8. So each pipe is used for different purposes.

 Color and Appearance:

PVC plastic comes in a range of colors, and the design is being taken into account
for the intended application as well as client preferences. For PVC windows, for
example, white or beige may be preferable, whilst darker colors may be utilized for
outdoor applications. Depending on the intended look, the finish might be glossy,
matte, or textured.

Production process and Facility Layout: Sukkur Plastics production process

is not that much difficult. At first they purchase the raw material from Engro
Chemical and Polymers. Because of the unstable economic environment like Pak
Rupee and higher inflation, the prices of PVC Resin is growing rapidly which in turn
incurs cost for the manufacturers. Then they process the raw material in machine
that creates “PVC Resin Pellets”. The workers input these pellets in the machine
that create PVC pipes. With the proper functioning of machine, the output come
out in the form of a perfect PVC pipe. Water and Electricity are the major elements
in this production. High amount of water is required to cool down the pipe in the
machine because without that the pipe will lose its round shape. So with the
production of PVC Pipes, water showers are there to cool down the pipe. And
 electricity is used for the functioning of the machine. Then they store the pipe in
the inventory area. Facility Layout is not that much strategic. The main reason to
build a plant in Sukkur Industrial Area could be like they want to serve the Interior
Sindh because there are still big giants in Karachi and other metropolitan cities.
Interior Sindh market can be the reason to build the whole setup in the city like
Sukkur.

Inventory needs and its management: The inventory needs at Sukkur Plastics
depends on many things like the types of pipes produced, customer demands,
production capacity and also the lead time to obtain raw material. On general they
work on the simple demand principle that when the customer will demand then
they will produce the product. They have also set a threshold like there must be at
least 50 pipes of each inch category. So they always store the inventory in case of
irregular trend in the demand. And by their manager they also follow the news like
when the government announced the "Mera Ghar Mera Pakistan" housing scheme
then they knew that the PVC pipes is used in house construction. They increased
the production and in turn booked higher profits.

Supply Chain Mapping:

Raw Material PVC Pipes

Making Pellets Retailers Customers
from Engro Production
Chemicals

To be continued…